REAL ESTATE

Stardust Arcade opens at Boynton Beach Mall

BY CSA STAFF

Boynton Beach, Fla. — Indianapolis-based Simon Property Group announced that Stardust Arcade, an adult penny redemption arcade, has opened at Boynton Beach Mall, in Boynton Beach, Fla.

The 10,000-sq.-ft. space features 150 machines within a Las Vegas-style setting showcasing faux Roman columns, marble details and hand-painted Greek themed murals created by Florida Atlantic University’s Arts Professor Jim Crane and his fine art students.

Boynton Beach Mall features a Cinemark 14 Theater, Too Jay’s Deli, Macy’s, Dillards Men’s and Women’s, J.C. Penney and Sears, along with over 145 specialty stores and eateries.

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Irrational Optimism?

BY Jeff Green

From where I sit, I’ve noticed a certain “buzz” of optimism in our industry — frustrations and anxieties from a tough couple of years seem to be giving way to increasingly sunny retail sales forecasts. Is this sudden sense of optimism justified by cold, hard facts? Or, is this increasing sense of optimism somewhat irrational?

There was a definite post-holiday change of tone after a relatively successful shopping season; those couple of months seemed to almost prompt a case of collective amnesia among industry peers. It seemed as if some took the first sign of anything positive and started sending the message that “all is well” in retail again. We are already seeing landlords much less likely to make deals with tenants in recent months as a result. However, I often compare the current state of retail sales and, to a large extent, fortunes of the retail real estate industry, to a turtle: right now things are starting to move in the right direction, but at a very, very slow pace.

There are definitely some reasons for optimism: Thomson Reuters recently reported a 1.7% retail sales increase in March among the 25 retailers they track, with the Limited, Saks Fifth Avenue and Costco — retailers that represent a very broad base of appeal from luxury to moderate specialty to warehouse — reporting particularly impressive gains. There are also some good indications that the market is a little less volatile than it has been at times in recent years, with the growth gap narrowing between the highest- and lowest-performing retail sectors (less than 5% in March versus 11% last year at this time). March was also the ninth straight month of gains. And while consumer confidence has dipped in response to the Japanese earthquake/tsunami, it has generally been on the rise. Combine that with lower unemployment and tons of pent-up demand, and there are plenty of reasons to be hopeful.

But it is worth pointing out that most of these gains have really been pretty moderate, and that it doesn’t take much to qualify as an improvement when the previous numbers were so terrible. It can be a good reality check to consider the fact that “lower” unemployment — 8.8% — is being cited as a positive figure these days; a number that would have been unthinkable just a few years ago.

Also worth a second look is the fact that, while value-oriented retailers have recovered faster than most, the improvement has been not as consistent across the board. Is it safe to say, “Retail is back” just because some segments have shown modest growth at best? While it is a good sign that a few retailers are expanding, it’s important to note that those looking to grow have lots of options and are very price sensitive. Those who are growing seem to be most interested in places where they can get a great deal-taking second-generation space, and shopping around in markets with lots of it.

I don’t think there’s anything wrong with being optimistic! In fact perception can become reality, as optimistic thinking and positive talk can generate its own momentum. I do think, however, that for the next six months or so, we are likely to continue bouncing up and down along the bottom of this so-called “recovery” we’re in: If some of the early signs of recovery don’t pan out like so many are expecting/predicting, then any preliminary retailer expansion plans are going to remain very limited. That disconnect between the retail real estate community and the reality on the ground won’t just be disappointing; it could also be costly.

What do you think? Email me at [email protected].

Jeff Green is president and CEO of Phoenix-based Jeff Green Partners (jeffgreenpartners.com), a leading consulting firm specializing in retail real estate feasibility, retail expansion planning, medical retail planning, location analysis and commercial land use.

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The Crossings at Four Corners

BY CSA STAFF

Located just 10 miles northwest of downtown Atlanta in Smyrna, Ga., The Crossings at Four Corners is currently undergoing a complete revitalization. The 153,000-sq.-ft. redevelopment, which officially broke ground on Feb. 8, includes the installation of a new traffic signal at the north end of the property, the renovation of approximately 60,000 sq. ft. of retail space and the addition of several outparcels. The true core of the project, however, will be the brand new, 96,000-sq.-ft. Kroger Food store.

Tri-Land acquired The Crossings at Four Corners in 2006. The Illinois-based redeveloper saw this as an opportunity to redevelop a premier 20-acre retail site located at the high profile intersection of South Cobb Drive and Concord Road in Smyrna. While a number of redevelopment options were explored, it was clear to Tri-Land that the Kroger Company operated an outdated and underutilized, thirty-year-old store located diagonally across the intersection from the property. Despite the weak economy and the pullback by many retailers on their expansion plans, Tri-Land and Kroger closed the purchase and sale of a 7.5 acre portion of the redevelopment site in December 2010 and the construction is now underway.

The new Kroger store will feature a floral department, an expanded bakery, a wide wine and beer selection, a gas station and a drive-thru pharmacy window. In addition to the headlining anchor, The Crossings redevelopment includes the complete renovation of the remaining 60, 000 sq. ft. of retail shops, including new facades, storefronts, roofs, interior improvements, three new entry points, and new paving, curbs, brick paver accent sidewalks, new high intensity parking lot lighting and substantial new landscaping.

Prior to beginning redevelopment, Tri-land de-leased the entire project to enable the redevelopment to move forward. The company has now begun a strategic re-tenanting process based on tenant mix and other leasing considerations, with outlots and further expansion scheduled to move forward in 2012. Phase I of the redevelopment is off to a great start and is scheduled for a November 2011 completion. When all is said and done, The Crossings will be a modern 230,000-sq.-ft., pedestrian-friendly community destination retail complex.

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